Rights and Remedies Under the Fair Credit and Reporting Act
Following the financial crisis in 2008, the Federal Trade Commission drafted the Fair Credit Reporting Act. The act provides protection from the type of dangerous credit practices that hurt consumers.
The full text of the Fair Credit Reporting Act, or FCRA, is nearly 100 pages long, making it difficult for consumers to understand their rights. More importantly, it is essential to understand the remedies available to individuals who have been victims of harassment or erroneous behavior by a consumer reporting agency. Hiring an FCRA attorney can help determine the right recourse based on what rights an agency violated.
There are three areas regulated under the FCRA:
- Agencies who manage consumer reporting
- Companies who make use of consumer reports
- Companies who provide consumer information
This includes a much wider range of businesses than just consumer reporting agencies. The Act provides protection for any kind of communication regarding transmission from a consumer reporting agency that is used to determine an individual’s credit -worthiness. This affects the credit reporting agency and the company that requests information about the individual.
Any company that uses an individual’s credit information is subject to the FCRA. Some of the most common uses for consumer credit reports include potential employers, insurance companies, and companies that provide home utility services. This is a much larger percentage of businesses than just consumer reporting agencies.
Any company that uses an individual’s credit report must adhere to all of the regulations in the FCRA.
To ensure that consumers have protection and recourse in the event a consumer reporting agency acts in a way that is unethical, the Act provides several remedies. Consumers who have been harassed or who have had their rights violated, have several options in terms of remedying the violations. Victims may seek one or more of the following:
- Payment for actual damaged
- Payment for punitive damages
- Payment for statutory damages
- Fees for retaining an attorney
If a plaintiff proves that a violation was willful on the part of the company, statutory damages range from $100 to $1,000. The plaintiff must report the violation either within two years of finding the violation or within five years of when the violation occurred.
Problems associated with consumer reporting agencies caused a number of issues that resulted in the Great Recession. The Act is long and complex. An FCRA attorney can help victims understand how their rights were violated and decide the right course of action.